Credit Card Articles

How To Redeem Rewards Points And Miles During The Holidays

When it is time to shop for a holiday, you want to cut as many corners as possible in order to keep it as affordable as possible. If you have rewards points on your credit cards, what you may not realize is that you have a great deal of savings in your hands just waiting to be used.

Any holiday that requires gifting can be challenging to a budget. Between the shopping, entertaining family, and even traveling, it is no wonder so many people look toward their reward points for a little bit of a financial break.

The gifts are usually the top priority during a holiday. In fact, Capital One's quarterly Rewards Barometer states that 59 percent of holiday budgets are all about the gifts. Meals constitute 20 percent of budgets and of all of it, gift cards are the most popular item that rewards point members redeem their points for. Next comes gift cards and the third is domestic airline tickets. In the end, travel only makes up 11 percent of the average holiday budget.

However, using your rewards points and miles toward travel during the year can save you money that can be applied toward your holiday budget. But when you wish to use points that you have accumulated throughout the year toward the holidays, what ways can you redeem them and get the most out of them?

Cyber Monday!

The Monday after Thanksgiving is Cyber Monday and it is a huge day for shopping online. You can check out online sales ads so you can find out what is on sale that day in order to go ahead and compare before you shop. This will help you land the best deals online. This is an important activity for approximately 43 percent of rewards cardholders since they skip going out to the stores on Black Friday. Most of them prefer to shop online and this number is growing every year.

But what you can do by comparing deals online is find out whether it is better for you to pay for something outright or use rewards to purchase it. Sometimes it can be cheaper to pay for it outright and then you can use your points toward another purchase that will save you money.

Revolving Categories

One practice that you can grow accustomed to is register for revolving categories. Take a card that offers a 5 percent discount for revolving categories that are geared toward holiday spending. In 2013, Discover Cashback was offering a 5 percent bonus for when cardholders shopped online for electronics, apparel, gifts, and toys. At the same time, Chase Freedom cardholders were able to earn 5 percent cash back on Amazon.com purchases up to $1,500, as well as department stores such as Sears, Macy's and JC Penney. If customers shopped through the Ultimate Rewards portal with their card, they received another five percent cash back. This resulted in those cardholders receiving a total of 10 percent cash back.

Do A Little Double Dipping

A little double dipping doesn't hurt either. Some credit card companies will offer discounted gift cards if they are purchased with rewards points. During the 2013 holiday season, some card companies offered 10 to 20 percent off of certain gift cards that were purchased through their rewards websites. Other card companies promised to increase or double cash back reward if gift cards were purchased from any of their partners.

In order to maximize your return on your gift card investment, you can buy discounted gift cards and then use them to buy gifts. For instance, 3,000 rewards points usually averages $30 in cash. If you were to use the points to get a $50 gift card, you are saving money on that purchase. If you then use that gift card to buy gifts in a sale, you are saving even more on your shopping.

Utilize Rewards Portals

The easiest way to get an extra payoff is to shop through the online shopping portal of your rewards program. Some card companies call their rewards portals their "mall." It is possible that shopping through a portal will not save you money during a holiday, but you can bank some more points for later so that you have some additional spending power when you may not have much money to spend.

There are many cardholders that do not realize that shopping through their rewards program portals will save them a lot of money. In fact, it is one of the biggest missed opportunities by cardholders. They may be missing out on additional points and savings.

You can even book holiday travel through a rewards portal. If you are planning a trip during the holidays or any time of the year, you can get more out of your points this way. For instance, you can book a round-trip flight and save a great deal of money on the tickets or, if you have a lot of miles, you can get the flight practically free. This is one of those cases where you can use points and miles wisely. For instance, you could save more on your flight than the $500 TV in the online mall.

Find Forgotten Points

If you have not used points because you forgot about them, it's time to dig them up. Many individuals forget that they have points that they can use. The good news is that their points don't expire and this means that they are always there for them to use. Sometimes it is just a matter of a person remembering to use the points on cards they don't use as much as others.

In the meantime, just keep it simple. You may want to just focus your efforts on one card. If you do have more than one, figure out which one is going to give you the most value for your time and efforts. If all else fails, you can give points and miles to charity. They always use them for wonderful causes and you have the satisfaction of knowing your points went to good use.

Final Word

All in all, it is important to redeem points at any time so you can save money toward your holiday shopping. Whether you save money on your vacation during the summer or you use points to buy gift cards as gifts or to save you more money on purchases, there are many ways to redeem.